Cotton Pulls Back After Strong Start to the WeekPosted 10/24/2018 8:55AM CT |
December cotton started the week trading 2.13 higher, closing at 79.98. Tuesday we saw the market take back some of the week’s gains, trading to a low of 78.18 before closing up off the lows at 78.92. Cotton has seen support from rains in key Texas growing regions and there is more rain in the next 5 day forecast as well as in key growing regions of the south eastern U.S. There is still a chance for additional decrease in crop conditions, adding to the loss in Georgia from the hurricane. India is also seeing increasing worries over the size of their crop. The market is still trending higher with potential for a continued advance up to resistance at 80.81 and then 82.55. Momentum studies are approaching overbought levels which could accelerate a move lower given some bearish pressure. Support comes in at the trend line around 78. 38 and then below that at 77.33. Look for the market to trade higher and test resistance levels with a close below secondary support to turn the rend back down to the recent lows.
Cotton Dec ’18 Daily Chart